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There Are Only Nine Listed Companies In The Uk But The Main Concentration ...


There are only nine listed companies in the UK but the main concentration for retail banking is in the big ‘five', Barclays (), RBOS (), HBoS (), TSB () and National Westminster (). Given that larger firms are more likely to make acquisitions and smaller ones are more likely to be targets ( ), especially in cross-border acquisitions which within Europe so far have been quite rare, the focus should be on this group.
As a result the desire to say emulate much of the research done by US and more recently Italian bank studies and applying them to the UK does not seem appropriate. Especially in light of the fact that the proposal appears rooted in the present and the future what are the motives now for UK banking in making acquisitions and what would those acquisitions be in the future.
This sample set is further reduced by the fact that we know Barclays Bank has publicly announced its intention not to make acquisitions but to grow organically (FT Blah Blah). When it comes to ownership we must also question HBoS, which was not a UK based company but bought Midland Bank in XXXX. If our sample size, in terms of the possible acquirers has been reduced to just three then this represents our first problem and excludes any form of regression analysis, which not all but most analysis has been, for the first part of the analysis at least. Unless of course the aim is for an ex-ante analysis of the UK market, which would probably be better carried out in other countries, with much large sample sizes.
Having assumed that a qualitative approach is needed to determine the motives for acquisitions by UK banks and that the domestic market is already heavily concentrated and so the scope for domestic acquisitions is limited, then the complicated nature of bank consolidations in general and mergers across borders in particular, requires an extended use of more sophisticated and detailed analysis methods for the examination. The measurement of financial performance objectives is generally lagging in time, showing past performance of previous decisions rather than the impact of current actions on future performance. You cannot use one performance measure. Hence the idea of using several measures, including non-financial measures.
(7) Purpose of study
The goals of this study are:
To determine what currently motives UK bank executives into making an acquisition.
Given the lack of
use that information in finding the best/most appropriate target to ensure a successful acquisition.


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